Monthly Archives: November 2012

A few days ago, I took a trip through the 2010 Minnesota Orchestra e-tour site. That’s the place where I found the “winning” article from Gig Magazine, where the Minnesota Orchestra was described “as a beacon institution among the bad [economic] news.” Not long after I blogged about that article, it mysteriously vanished from the Orchestra’s website. Luckily, a reader had told me to take screenshots, and so I posted those. We’re going on seven weeks now, and management has yet to address the disappearance.

Anyway! During my recent return trip to the e-tour site, I found some more quotations that I feel compelled to share with you now. They’re from an interview that Minnesota Orchestra CEO Michael Henson gave to Classical Music Magazine in August 2010 called “Flying the flag.” I’m not even going to bother with the cache. Here’s a direct link. When that’s taken down, here are the screenshots. Click for bigger images.

Mr. Henson is speaking…

“We’re being fiscally prudent, looking at how we plan the short term at the same time as being mindful of the medium and long term.”

“The current Sommerfest series is being well attended and the orchestra came in on budget for the 2009/10 season.”

In the 2008-2009 fiscal year, the Minnesota Orchestral Association, or MOA, says their operating draw percentage was 10.7%; in 2009-2010, the orchestra says the operating draw percentage was 11.4%. (I say “says” because guest blogger and local nonprofit professional Mary Schaefle reports that the numbers released to the public don’t match the MOA’s tax returns, and so far, we have not received clarification from the MOA on this point.) As Jon Campbell, the chair of the MOA board of directors, and Richard Davis, the immediate past chair, put it, “In Minnesota, we were able to deliver balanced budgets through large, unsustainable endowment fund draws and ‘bridge-the-gap’ fundraising.” Which – and correct me if I’m wrong about this – is bad. But according to August 2010 Michael Henson, unsustainable endowment fund draws and “bridge-the-gap” fundraising are also….fiscally prudent, and being mindful of the short and medium and long term. Or something.

Although there has been a slight decline in recent audience numbers, it has not been enough for alarm bells to sound.

But… I thought national trends indicate a need for change…

So I guess there’s a need for change, but there hasn’t been enough change for alarm bells to sound? Or in other words, there’s no need for changes that require a significant departure from the traditions of the past?

Clarification would be very cool right about now.

“We’ve done a very good job in terms of maintaining audiences and indeed the audiences have really shown that even if we’re in a tough economy, people still want to come out and hear a great orchestra.”

In the fiscal year lasting from 2009-2010 (the year Mr. Henson had just finished as he gave this interview), overall attendance dropped by 7%, from 270,000 to 250,000. Is this “a very good job in terms of maintaining audiences”? I suppose if you get convoluted about it, and if most other American orchestras saw their attendances plummet by 10% or 15% that year (and I don’t know if they did), you could make that case. Otherwise…I dunno. Please forgive me if I’m not completely convinced. I’d love to hear more of the subtleties of the argument, and more figures to back the argument up. If Mr. Henson ever sits down with a reporter like Matt Peiken from MNuet, these remarks could form the basis of a fascinating and productive discussion. (Mr. Peiken has asked to interview Mr. Henson; Mr. Henson has not yet accepted the invitation. Maybe he will now.)

(And yes, I’m aware that a big chunk of that attendance drop can be ascribed to the fact there were 9% fewer concerts in the 2009-2010 season, as Mary has explained here. But Mr. Henson wasn’t talking about revenue here; he was just talking about audience maintenance.)

At the time Henson was appointed to the Minnesota Orchestra, he was quoted as saying he believed orchestras were in a golden period. That, he says, is still the case.

Yes, apparently we are in a…golden period. Pretty fricking depressing Golden Period, if you ask me, but…OK.

 “At the moment we are getting some great artistic performances from major orchestras in America. The real challenge is looking at the long term future. It’s critical that the art remains central to our mission and critical that we continue to act in a fiscally prudent way. This orchestra’s been in existence for well over a hundred years and our job and duty is to make sure it’s thriving for the next hundred.”

What?

I agree with Michael Henson about something?

Yay!

This warrants a celebration.

OK, celebration over.

Now. Remember, at the exact same time that he was saying all of these things…”golden period”, “people still want to come out and hear a great orchestra”, “we’re being fiscally prudent, looking at how we plan the short term at the same time as being mindful of the medium and long term”…Mr. Henson was, behind closed doors, not only approving endowment draw rates of over ten percent, but Strategically Planning the Strategic Plan that would culminate in 20-40% pay cuts for musicians, prominently highlight how “stressed” orchestras are, and produce a drastically altered mission statement that can be interpreted as the MOA having no interest in supporting orchestral music at all. By management’s very own admission, the Strategic Planning began in the spring of 2010: months before these sentences were ever uttered to Classical Music Magazine (or, for that matter, Gig Magazine).

So, to sum, as he was giving these rosy interviews to the international press, behind closed doors, Mr. Henson was saying (formatting mine for emphasis):

• “the status quo can no longer be preserved” (from the Open Letter)
• “…this is a journey that began several years ago, when the Board of Directors of the Minnesota Orchestra recognized that the organization could no longer survive based on optimistic economic assumptions and the hope of limitless benefactor generosity” (from the Open Letter)
• “…the reality is that over the past three years we met regularly with our musicians and others with a stake in our future to share the clarity of our financial challenges“… (from the Open Letter)
• “Board and management have been communicating the financial position of the Orchestra with musicians for three years.” (from the Misrepresentation vs. Reality chart)
• “As part of the strategic planning process, the board openly shared the Orchestra’s financial situation with musicians in a series of meetings spanning three years.” (from the Misrepresentation vs. Reality chart)
• Would you like me to keep going? Because I could keep going. But alas, I have pity for this dead horse.

So.

What are you feeling right about now? Personally, I’m suffering from a bad case of confusion, and the only thing that has a chance to cure it is a long, long hours-long sit-down chat with Mr. Henson himself.

Here are some more quotes that struck me as odd as I was paging through old newspaper articles. Lots of interesting ones…although, awkwardly, none of them are as damaging as what is actually still on the Minnesota Orchestra’s own website.

Terms of his [Henson’s] contract were not disclosed. According to public documents, [Tony] Woodcock, his [Henson’s] predecessor, earned an annual salary of about $300,000. – Pioneer Press, 22 September 2007 [According to public documents, Mr. Henson’s salary in the 2010-2011 fiscal year was $360,283; total compensation was $389,861. We are currently waiting on numbers from the 2011-2012 fiscal year. Since I don’t have a paid account with Goldstar, I have no access to the 990s that would go into the details of Mr. Woodcock’s compensation.]

 

Henson believes the hall’s finest characteristics must be preserved. He has visited the new Guthrie Theater, MacPhail Center and the Walker Art Center and came away concluding that while all three make distinct visual statements, it is what happens inside the building that matters most.

“There is no point in having a great building without having great art inside it,” he said. – Star Tribune, 24 February 2008

 

The Minnesota Orchestra has raised $24 million toward its $40 million Hall renovation. Michael Henson, president and CEO, told the Orchestra’s annual meeting Wednesday that $10 million was raised in September alone. In other financial highlights, the Orchestra balanced its budget for the third consecutive year even as total attendance declined, and ticket revenue rose 4.4 percent…

“We must balance artistic initiative with fiscal responsibility,” Henson told the noon luncheon in downtown Minneapolis. “We’re quite pleased with these results in a challenging year.” – Star Tribune, 9 December 2009. [In the 2008-2009 fiscal year, the year Mr. Henson is referring to here, the MOA states the endowment draw rate was at 10.7%, over double what they now say is “sustainable” and responsible.]

 

Michael Henson, Minnesota Orchestra CEO and president, hinted Monday that the organization’s renovation of Orchestra Hall might be expanded. Henson’s optimism came after Gov. Tim Pawlenty included $14 million for the project in the state bonding bill. Coupled with private and corporate fundraising of $24 million, the orchestra has now raised $38 million toward a plan that was announced last summer at $40 million.

“You recall that the project was downsized from $90 million,” Henson said, referring to a previous plan announced in 2007. “If we can generate more money through our fundraising, then it would make sense to grow the project, but it’s too early to say that, and we’ve made a priority to be fiscally responsible.”…

It is no secret that the orchestra has been pleased with its fundraising. Last June, when Toronto architects Kuwabara Payne McKenna Blumberg Architects (KPMB) were chosen to spearhead the renovation, pledges for $14 million had been secured. That grew to $24 million by last December’s annual meeting. An organization’s ability to raise private capital helps its chances in the legislature. Henson said he was pleased that “the governor has shown confidence in this project. It’s a very good day for the orchestra.”

KPBM was expected to deliver sketches last December, but that likely was delayed to see whether fundraising might be robust enough to expand the project.  – Star Tribune, 15 March 2010

 

A gift of $5 million from Target has pushed the Minnesota Orchestra past a $40 million fundraising goal for its Orchestra Hall building project. With the Target donation, the orchestra has raised $43 million to expand and refurbish the 1974 hall’s lobby and surrounding terraces.

Target’s is the campaign’s largest corporate gift. The state of Minnesota contributed $14 million through state bonding, and one individual gave $5 million, according to Michael Henson, the orchestra’s president and CEO.

At the same time, the organization announced that the building project is part of an even larger fundraising effort it calls the Building for the Future Campaign. That initiative has raised $82 million toward a $100 million goal and has been talked about only within the orchestra and the philanthropic community. The campaign includes $40 million for the building project, $30 million for the orchestra’s endowment and $30 million to support artistic and education programs.

However, Henson said, within that framework it’s possible that more money could be dedicated to the renovation.

The $40 million was a “focused budget,” he said. “By passing that amount, we’re not going to increase the scope of the project, but we will increase the quality of finishes and other aspects that give us additional value.” – Star Tribune, 15 June 2010

So, um.

Wow.

But those weren’t the only articles I read. Over the course of a lazy afternoon, I carefully studied a couple dozen in which Mr. Henson discusses his work in Minnesota. In none of them was there any hint of an impending apocalypse, or even a “market reset.” True, there were articles about cutbacks in staff after the Great Recession began, and occasional mentions of a “difficult economic climate“, but just about everybody suffered staff cutbacks after the Great Recession began, and of course we all knew we were in a “difficult economic climate.”

Here. Don’t take my word for it; check out Highbeam or EBSCO yourself. The search term you want to use is “Michael Henson” orchestra. Leave any interesting links I may have overlooked in the comment section, especially if they prove me wrong. Because I’d love to be proven wrong. Go ahead. Make a fool of me.

I eagerly await Mr. Henson’s (and Mr. Campbell’s, and Mr. Davis’s) clarifications.

…………………..Because they’d better clarify.

Here’s a final observation from Mr. Henson from August 2010:

“These are much bigger organizations than British orchestras. That requires the right sort of skills and anybody contemplating coming here has got to have the right skill set. But there are some fantastic opportunities in America.”

…

Indeed.

So. What have we learned?

Assuming the MOA wants to support an orchestra (and at this point, I’m not convinced they do; they can get back to me on that one when they change their mission statement back to include the word “orchestra”), we’re going to keep circling round and round until we agree on the answer to one simple question:

Can you sustain – nay, heighten – the artistry of an orchestra while also cutting its budget by twenty percent over the course of one season? Can you pay twenty percent less for a product and still get a better product? (Especially when you can’t outsource the assembly of said product to China?) Do you believe that an orchestra that pays roughly half as much as the best orchestras in this country – that consists of demoralized dejected players seeking work elsewhere – that has no seniority pay – that has a management team reviled by musicians and music-lovers across the world (and I’m not exaggerating when I say that)…do you believe that such an orchestra will ever become a professional destination for world-class players? (Especially if – sigh; when – Osmo leaves in 2015?) I say no. (Robert Levine, a member of the Board of Directors of the League of American Orchestras, also says no.) (Arts consultant Drew McManus has also expressed doubts.) I maintain that no matter what Mr. Henson says, easily walkable geography does not a desirable location make.

If you don’t have the money to sustain an orchestra’s quality, should you level with your public and say they can’t support the quality of ensemble they’ve grown accustomed to unless they pony up tons more cash and quickly, or should you promise your patrons the moon in the cynical hope they won’t notice when your orchestra starts to decline? As a patron, what kind of management do you want to have in charge? People who are level with you about the challenges ahead, or people who consistently sidestep the truth over a period of years?

Hopefully we all agree: eventually we’ll reach a tipping point. Obviously we can’t buy a world-class orchestra for, say, $0 a year. So somewhere along that sliding scale between $32 million and $26 million and $0, we’ll lose our “world-class” quality. So where is the Minnesota Orchestra’s tipping point? Is it at $30 million? $28 million? $25 million? $10 million? If we’re going to cut twenty percent, then what keeps us from cutting, say, thirty percent? Forty percent? Fifty percent? After all, that would give us more money to invest in the endowment. It would protect us against another major recession and give us more money to use on educational programs. How about we cut ninety percent? Ninety-five? Ninety-nine? How about the musicians pay us to have the chance to play in a world-class orchestra? All right; now I’m being hyperbolic. But hopefully you understand the broader point I’m trying to drive home here. Where is that tipping point? How close to the bone can we shave without seeing a marked decrease in quality (and an accompanying decrease in financial support)? Do we know? If so, how do we know? And why was the community never given a chance to discuss this? Because we’re not dumb. We could have helped you solve the problem, you know. It’s our orchestra, and we deserve to have a say in its future.

The only way I can reconcile Mr. Henson’s words (without labeling him a self-serving cynic who specializes in painfully inept incompetence) is to assume he honestly believes that a world-class orchestra – (in a golden age of orchestras) – will thrive artistically – (and therefore, financially) – after he brutally gouges the salary and working conditions of his musicians, and misleads and then infuriates his devoted public. Personally, I find that idea to be roughly as realistic as the idea of an obese man flying around the world to deliver toys to every good boy and girl on the face of the earth, and so do many experts in the field. The idea may be comforting at first glance, but in practice, it’s unworkable. But for whatever reason, a lot of people on the board appear to agree with Mr. Henson.

So what do you think? What I think isn’t important. It’s what you, the patrons, think that really matters. (Or, at the least, what should really matter.)

As always, the comment section is open.